BILL NUMBER: AB 1694	CHAPTERED  07/28/99

	CHAPTER   200
	FILED WITH SECRETARY OF STATE   JULY 28, 1999
	APPROVED BY GOVERNOR   JULY 27, 1999
	PASSED THE SENATE   JULY 15, 1999
	PASSED THE ASSEMBLY   JUNE 1, 1999
	AMENDED IN ASSEMBLY   MAY 24, 1999
	AMENDED IN ASSEMBLY   APRIL 29, 1999

INTRODUCED BY   Committee on Revenue and Taxation (Knox (Chair),
Ducheny, Honda, and Romero)

                        MARCH 25, 1999

   An act to amend Section 74 of the Revenue and Taxation Code,
relating to taxation, to take effect immediately, tax levy.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1694, Committee on Revenue and Taxation.  Ad valorem taxation:
fire detection systems.
   The California Constitution generally limits ad valorem taxes on
real property to 1% of the full cash value of that property.  For
purposes of this limitation, "full cash value" is defined as the
assessor's valuation of real property as shown on the 1975-76 tax
bill under "full cash value" or, thereafter, the appraised value of
that real property when purchased, newly constructed, or a change in
ownership has occurred.  The California Constitution authorizes the
Legislature to exclude from classification as "new construction" the
construction or installation on or after November 7, 1984, of fire
safety improvements that include a fire detection system.  Existing
statutory law implementing this exclusion defines a "fire detection
system" to include any system or appliance intended to, among other
things, activate an alarm or signal.  It also specifies that a fire
detection system includes any system that serves additional
functions, but limits the exemption to that portion that is for fire
detection purposes.
   This bill would expand this exclusion to specify that a fire
detection system includes, as provided, all equipment used to
transmit fire alarm activations and related signals to a remote
location.
   Section 2229 of the Revenue and Taxation Code requires the
Legislature to reimburse local agencies annually for certain property
tax revenues lost as a result of any exemption or classification of
property for purposes of ad valorem property taxation.
   This bill would provide that, notwithstanding Section 2229 of the
Revenue and Taxation Code, no appropriation is made and the state
shall not reimburse local agencies for property tax revenues lost by
them pursuant to the bill.
   This bill would take effect immediately as a tax levy.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 74 of the Revenue and Taxation Code is amended
to read:
   74.  (a) For purposes of subdivision (a) of Section 2 of Article
XIII A of the Constitution, "newly constructed" does not include the
construction or installation of any fire sprinkler system, other fire
extinguishing system, fire detection system, or fire-related egress
improvement that is constructed or installed on or after November 7,
1984.
   (b) Notwithstanding any other provision of this chapter or Chapter
3.5 (commencing with Section 75), neither "newly constructed" nor
"new construction" includes the construction or installation of any
fire sprinkler system, other fire extinguishing system, fire
detection system, or fire-related egress improvement that is
constructed or installed on or after November 7, 1984.
   (c) For purposes of this section:
   (1) "Fire sprinkler system" means any system intended to discharge
water for the purpose of suppressing or extinguishing a fire, and
includes a fire sprinkler system that derives its water from the
domestic water supply of the building or structure of which it is a
part.
   (2) "Other fire extinguishing system" means any system intended to
suppress or to extinguish a fire other than by discharging water
upon the fire.  An "other fire extinguishing system" includes, but is
not limited to, a component or application that, solely or primarily
for the purposes of fire suppression or extinguishment, is made part
of the heating, ventilating, or air-conditioning system of a
building or structure, a wet chemical system, or a dry chemical
system.
   (3) "Fire detection system" means any system or appliance intended
to detect combustion, or the products thereof, and to activate an
alarm or signal, whether audio, visual, or otherwise, including all
equipment used to transmit fire alarm activations and related signals
to a remote location.  A fire detection system includes any system
that serves additional functions, but this section shall only apply
with respect to that portion of a system that is for fire detection
purposes.  No portion of a fire detection system as described in this
paragraph shall be deemed to be personal property, or shall be
deemed to be excluded from that fire detection system, by reason of
being owned or controlled by a person other than the owner of
property upon which the fire detection system was constructed or
installed.
   (4) "Fire-related egress improvement" means any improvement
intended to do either of the following:
   (A) Provide any new, or improve any existing, means of egress for
individuals from a structure, or any portion thereof, in which a fire
is in progress, as to which there is an imminent threat that a fire
may soon be in progress, or as to which individuals therein might be
subjected to health hazards or the risk of physical injury due to a
fire elsewhere.
   (B) With respect to individuals who for any reason cannot evacuate
a structure in which a fire is in progress, provide a means of
safeguarding, or increasing the safety of, those individuals until
the time that the rescue of those individuals can be effected.
   (5) "Existing building" means any building or structure already
erected at the time that a fire sprinkler system, other fire
extinguishing system, fire detection system, or fire-related egress
improvement is constructed or installed in that building or
structure.
   (d) Any system or improvement referred to in this section shall be
deemed to have been constructed or installed on or after November 7,
1984, if the actual construction or installation thereof is
completed on or after November 7, 1984, regardless of when the actual
construction or installation thereof was commenced or any building
permit pertaining thereto was issued.
   (e) This section applies only to fire sprinkler systems, other
fire extinguishing systems, fire detection systems, and fire-related
egress improvements, as defined in this section, that are constructed
or installed in an existing building.
  SEC. 2.  Notwithstanding Section 2229 of the Revenue and Taxation
Code, no appropriation is made by this act and the state shall not
reimburse any local agency for any property tax revenues lost by it
pursuant to this act.
  SEC. 3.  This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.
